Halted Buyout Talks Draw Put Traders to Nutanix Stock

Put volume is running at 37 times the intraday average

Digital Content Manager
Dec 23, 2022 at 10:21 AM
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Nutanix Inc (NASDAQ:NTNX) is sinking today, last seen down 8.5% at $25.54, after talks with Hewlett Packard Enterprise (HPE) over a potential acquisition deal reportedly came to a halt, per Dealreporter. Plus, an HPE spokesperson confirmed that there are currently no ongoing discussions with Nutanix.

The security has been tumbling off a Dec. 14, one-year high of $33.73, and today lost long-term support from the 60-day moving average. The shares are also now pacing for their sixth loss in seven sessions, and are off 21.2% in 2022, despite a 20.5% quarter-to-date lead.

Analysts are yet to chime in, but are mostly optimistic on NTNX, with nine of the 14 in coverage calling it a "buy" or better. In addition, the 12-month consensus target price of $33.71 is a 34.1% premium to current levels.

The options pits lean bullish as well. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the equity's 50-day call/put volume ratio of 5.06 stands higher than all 88% of readings from the past year. This means long calls have been getting picked up at a quicker-than-usual clip.

The sentiment among options traders is already starting to change in light of today's update, though. So far, 11,000 puts have already exchanged hands, which is 37 times the intraday average, compared to just 1,315 calls. Most popular are the February 25 and 30 puts.


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